Abstract

Environmentally harmful boiler rooms that use coal and liquid fuels (heavy fuel oil and heating oil) remain in operation across Serbian cities, either as parts of centralized systems or as standalone units. Although they significantly degrade air quality, their decommissioning is often delayed because feasibility studies indicate unfavourable financial outcomes. While greenhouse gas emissions can be monetized through emission trading schemes, no widely accepted method exists for valuing local air pollution in investment assessments. This paper proposes a fuzzy decision-making model that combines financial, climate, and environmental criteria to support fuel-switching decisions and decommissioning. The model evaluates pollutant reductions, investment needs, and payback periods, translating them into fuzzy linguistic variables and applying max–min composition for overall prioritization. A case study of 25 boiler rooms in six Serbian cities demonstrates the approach. Results show that including environmental indicators highlights projects with substantial ecological benefits that would otherwise be overlooked under purely financial assessments.